Regret aversion bias: People make decisions made on the anticipated risks. They don’t want to become the active agent in a wrong decision. A major study was done to understand this bias. A flu epidemic has hit your community. This flu can be fatal for children under the age of three. The probability of a child getting the flu is 1 in 10‚ and 1 in 100 children who get the flu will die from it. This means that‚ statistically speaking‚ 10 out of each 10‚000 children in your community will die. A vaccine
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The aim of this experiment was to investigate the availability bias in judgments about the lists of names. The investigation was a replication of the famous study of Kahneman and Tversky (1974). In the experimental setup the independent variable consisted of a familiarity of listed names (condition 1: list of 19 “famous” males; condition 2: list of 20 “nonfamous” females). The dependent variable was the response to the question: “Which list was
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Behavioural Economics – how the hell does it work? Behavioural economics; just to warn you this is a monotonous article. You’ve chosen to read on‚ so presumably you are interested‚ or just a very boring person. A common confusion the ignorant adolescent might experience‚ is the assumption that behavioural economics is related to finance entirely – so yes‚ this article is a time wasting mechanism‚ providing the vacant brains of readers with tedious information in relation to the study of maths
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Managing Biases in Strategic Judgment Heuristics and Rules of thumb • People rely on various heuristics when making most decisions –Evolutionary reasonable strategy –Helpful but can lead to severe errors –Can result in biases –People are unaware of using heuristics most of the time –Why important to understand • Can correct/debias yourself • Understand what others are doing in deciding on your actions/strategies • Example: Recognition heuristic –Which city has a large population
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Financial Accounting Theory Craig Deegan Chapter 11 Reactions of individuals to financial reporting: an examination of behavioural research Slides written by Craig Deegan Copyright 2009 McGraw-Hill Australia Pty 11- Learning objectives • In this chapter you will be introduced to: – – – – – how behavioural research differs from capital market research how different accounting-related variables can be manipulated in behavioural research how the results of behavioural research can be of relevance
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Maritime transportation is the backbone of global trading. More than 80% of global product distribution are using ship (United Nations Conference on Trade and Development‚ 2015). Therefore‚ it has several advantages compared to land and air distribution. Compared to air transportation‚ maritime transportation is more efficient in terms of cost and quantity. Maritime transportation also can cover sea and have inter-island connected which are cannot be done by maritime transportation. Indonesia‚ which
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Decision making is the act of determining the best choice while examining a range of options. Decisions are made within one of the following decision environments: uncertainty‚ risk or certainty. Ronnen Harary‚ Anton Rabie and Ben Varadi‚ three university students‚ wanted to demonstrate that they were capable of growing a global corporation (Spin Master). Consequently‚ in the start-up of their company they had to face decisions from all three environments. The first major decision the entrepreneurs
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12th ed. New Jersey: Pearson Prentice Hall. Simon‚ H.A. (1947). Administrative behavior: A study of decision-making processes in administrative organization. New York: Free Press. Tversky‚ A.‚ & Kahneman‚ D. (1974). Judgement under uncertainty: Heuristics and biases. Science‚ 185(4157)‚ 1124-1131. Tversky‚ A.‚ & Kahneman‚ D. (1983). Extensional versus intuitive reasoning: The conjunction fallacy in probability judgments. Psychological Review‚ 90(4)‚ 293-315. Willman‚ P.‚ Fenton-O ’Creevy‚ M.
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Week 5 Quiz 4 Return to Assessment List Part 1 of 1 -20.0/ 20.0 Points 2.0/ 2.0 Points _____________ is the tendency for people to pay attention only to evidence that supports their beliefs. A.The availability heuristic B.Confirmation bias C.Hindsight bias D.Mental set Answer Key: B 2.0/ 2.0 Points Which of the following is NOT a component of the triarchic theory of intelligence A.Emotional intelligence B.Componential intelligence C.Contextual intelligence D.Experiential intelligence
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cognitive/judgmental error or biases can be applied to organizational behavior for continually adopting and improving better decision making strategies as a manager. The book focuses on descriptive approach to managerial decision making i.e. understanding decision heuristics in complex management environments and the resulting biases from them which gives a better insight into the decision making process‚ dependencies and strategies. For managers it is crucial to make decisions‚ and also understand the Decision
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